£1.3bn spent in spectrum auction to boost UK’s 5G rollout

(Image credit: Three)

The results of the UK’s delayed spectrum auction, which has raised £1.3bn for the Treasury, have been released this morning by Ofcom, the telecoms regulator. And it’s good news for owners of 5G phones on the country’s four mobile 5G networks: with EE Limited, Hutchison 3G UK Limited, Telefónica UK Limited and Vodafone Limited  all purchasing significant spectrum to expand their 5G networks to more locations and offer stronger signals.

A total of 200 MHz of spectrum was available to bid for in the auction, split across two bands: 80 MHz of spectrum in the 700 MHz band and 120 MHz of spectrum in 3.6-3.8 GHz band. This principle stage of the auction, involved the four companies bidding for airwaves in 34 ‘lots’ to determine how much of the available 5G spectrum they each secured.

Ofcom has revealed that he biggest spenders in the latest auction, which lasted less than a week, were EE, for EE 5G, and Telefónica, for O2 5G – both companies spent around £450m on additional spectrum.

700 MHz and 3.6-3.8 GHz spectrum bands

The spectrum bands for tender were the lower 700 MHz band and the higher 3.6-3.8 GHz frequencies. The low band was most expensive as it helps with indoor and rural coverage, while the mid-band spectrum is part of the primary band for 5G, perfect for boosting mobile data capacity, carrying masses of data-hungry connections.

Three, owned by CK Hutchison, has the largest spectrum holding of all the 5G networks in the UK but spent an additional £280m in this auction, boosting its low band holdings for Three 5G.

“Transformative effect on our customers’ experience indoors and in rural areas.”

Robert Finnegan, Three.

“We are delighted to have won two 10MHz blocks of low frequency spectrum at the auction. This triples the amount of low frequency spectrum we own and will have a transformative effect on our customers’ experience indoors and in rural areas. Coupled with our existing low frequency spectrum and the UK’s largest 5G spectrum holding, we are in a fantastic position to deliver a great network experience for our customers now and in the future,” said Robert Finnegan, Chief Executive Officer at Three.

Lastly, Vodafone UK, the only company to buy only in the higher frequencies, spent £176.4 million on 40 MHz of spectrum in the 3.6 GHz band frequency, to boost Vodafone 5G.

Ahmed Essam, Chief Executive of Vodafone UK, said:  “This auction will boost our 5G network capacity. It means we will have the spectrum we need to further the roll-out of 5G to our customers, bringing high speed connectivity and opening up new opportunities for products and services.”

“We have been successful in the 3.6 GHz band and have avoided expenditure on low band spectrum, where it is our strategy to refarm over time our significant 900 MHz holdings to carry 5G traffic,” continued Essam.

Assignment stage

The auction will now move to the ‘assignment’ stage. This is essentially now a single bidding round in which the companies can bid for the frequency positions they prefer for the airwaves they have secured in the principal stage.

The four 5G networks providers have the opportunity to negotiate the frequency positions among themselves and can join together the airwaves they have secured with spectrum they already hold in the wider 3.4-3.8 GHz band.

 “With bidding in the principal stage concluded, we now move to the next stage of the auction where the operators will have an opportunity to negotiate the position of their spectrum holdings in the wider band,” said Philip Marnick, Group Director, Spectrum at Ofcom.

“Supporting the UK’s position as a world leader in 5G.”

Philip Marnick, Ofcom.

“This is an important step forward in bringing better mobile services to people – wherever they live, work and travel. These airwaves will help improve coverage for the mobile services people use today, as well as supporting the UK’s position as a world leader in 5G, ” continued Marnick.

Rachael Sharpe

Rachael is a British journalist with 17 years experience in the publishing industry. Since launching www.digitalcameraworld.com, she’s been freelancing, and working for some of the world’s best-loved websites and magazines including T3.com and TechRadar.com and has also had a book, iPad for Photographers, published. A regular contributor at 5Gradar, Rachael is following the 5G market closely. Find out more at www.rachaelsharpe.com